The financing of multi residential, mixed use and commercial properties is a different game compared to the financing of single family homes and residential properties – up to 4 units – .

With residential properties up to 4 units , lenders are primarily interested in your income and credit , while with multi residential – above 4 units – and commercial , they are primarily interested in the two years financial statements of the property you are buying to assess how much debts it can support; followed by your net worth and credit.

Generally speaking the down payment requirement on multi residential and commercial properties are around 25% – 30% but 15% down payment options are available for qualified multi residential deals.

Frequently Asked Questions

Due to our strong lender relationships, we are able to offer competitive rates on both multi residential and commercial deals.
The rates are determined at the time of approval by the market’s bond yields and are generally lower on properties with a residential component to it.
Amortizations are generally around 25 years but can extend further on select multi residential deals.

Upon review of the property financials, we would be able to quote you the best rate give the bond yields at the time of assessment

On multi residential properties, you can buy with 15% down under the guidelines of CMHC (i.e. an insured deal). Under conventional lending for multi residential (i.e. no mortgage insurer), you can expect 25% – 35% down – depending on the strength of the deal – . For commercial and mixed use deals, expect around 35% down.

Some select-lenders will allow you to utilize vendor take back mortgages (i.e. seller financing) for a portion of the down payment if the Debt Coverage Ratio supports the extra mortgage payments. This technically reduces your out of pocket.

The approvals for multi residential, commercial and mixed used properties take much longer than a residential property.
The process starts with a Letter of Interest (LOI) from the lender, which take 2-3 days for the lender to issue once the lender reviews the 2 years financial statements for the property and the application.
An LOI states the loan terms the lender is offering as well as all conditions that need to be fulfilled to get formal approval such as appraisal and confirmation of key information (income, credit, property financials and net worth) through the related support documents.

It takes about another 3-4 weeks for the lender to complete the deal diligence and formally approve the deal.
Once a formal approval is issued, that is when you can typically waive your financing conditions.
It will take another 2-3 weeks from the point of approval to close the deal. Some larger deals, will take longer to approve and close but generally speaking: factor 4 weeks for the financing condition and another 4 weeks to close

We’ll guide your through the complexity…

Contact us to finance your multi residential investment…
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